6 Jan 2016
Plenty of run left in the USD upswing – Deutsche Bank
FXStreet (Delhi) – Research Team at Deutsche Bank, suggests that the multi-year strong USD cycle should extend for at least another two years, with a further 10% appreciation in the real broad USD TWI.
Key Quotes
“2016 year-end forecasts are largely unchanged, with EUR/USD, USD/JPY and GBP/USD seen at 0.90, 128 and 1.27 respectively. We anticipate extremes in the likes of AUD/USD, NZD/USD and USD/CAD at 0.62, 0.53 and 1.40 respectively.
In macro terms, how 2016 shapes up will be heavily influenced by whether the main macro driver is the Fed or China. If the Fed is the driver, USD gains are seen as likely to be slow and broad-based, spread fairly evenly between G4, commodity FX and EM FX. If on the other hand, China, particularly China FX policy, becomes a source of instability, USD gains will likely be heavily concentrated in commodity and EM FX, while the G4 majors all outperform.”
Key Quotes
“2016 year-end forecasts are largely unchanged, with EUR/USD, USD/JPY and GBP/USD seen at 0.90, 128 and 1.27 respectively. We anticipate extremes in the likes of AUD/USD, NZD/USD and USD/CAD at 0.62, 0.53 and 1.40 respectively.
In macro terms, how 2016 shapes up will be heavily influenced by whether the main macro driver is the Fed or China. If the Fed is the driver, USD gains are seen as likely to be slow and broad-based, spread fairly evenly between G4, commodity FX and EM FX. If on the other hand, China, particularly China FX policy, becomes a source of instability, USD gains will likely be heavily concentrated in commodity and EM FX, while the G4 majors all outperform.”